X Minutes from the Federal Open Market Committee's March 15 meeting turned a positive session on its ear Wednesday afternoon, stripping the market of its early advance and leaving the Dow, Nasdaq and S&P 500 all seeing red.
The Dow Jones industrial average tapped out with a 0.2% loss, down from a 1% gain early in the session. The S&P 500 and Nasdaq also erased gains, ending off 0.3% and 0.6%, respectively.
Small caps did worse, with the Russell 2000 ending 1.2% lower. Volume rose, according to early figures.
Bonds slid and stocks began trimming gains after Fed minutes released at 2 p.m. ET showed the committee prepared to raise interest rates more quickly if the economy showed rapid gains in strength. The notes also showed the Fed set to begin paring back its $4.5 trillion balance sheet, beginning with cutbacks to market-supporting reinvestments in bonds and mortgage-backed securities. Those moves would be tied to interest rates, suggesting that rate increases could occur more rapidly if inflation gained momentum.
JPMorgan (JPM) and Cisco Systems (CSCO) slipped more than 1.2% apiece, hauling down the Dow industrials. DuPont (DD) ran atop the index with a 0.8% gain.
The Dow Jones transportation average gave up its early gains to end a fraction lower for the day as five of the gauge's 20 stocks posted gains of better than 1%. American Airlines Group (AAL) and container-freight big dog Matson (MATX) climbed 1% and 2%, respectively. Avis Budget Group (CAR) dropped nearly 3%.
Transports received an early shot of confidence from Greenbrier (GBX), which pared its gains and ended 10% higher for the day. The Lake Oswego, Ore.-based maker of railcars reported a strong beat of fiscal second-quarter analyst expectations, as well as an agreement to expand the company's relationship with Japan-based bank Mitsubishi UFJ (MTU) to the tune of more than $1 billion. The gain put Greenbrier shares well up the right side of a cup base with a 49.60 buy point.
Oil prices backed off early highs, with West Texas intermediate futures ending up 0.3% but with the oil still above $51 a barrel. Energy issues took home five of the 10 worst losses among S&P 500 stocks. New-issue DXC Technology (DXC) topped the index, rising better than 3%.
Beyond the Fed minutes and the EIA's weekly oil report, the day's economic news was mixed. A much higher-than expected March hiring number from the ADP National Employment Report gave investors an early boost of confidence. That boost and the rollout of primarily positive company news bowled over the later negative service-sector purchasing managers index.
March PMIs from both Markit and the Institute For Supply Management failed to meet economist expectations.
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